NatWest chairman sparks controversy over comments on property market

NatWest chairman sparks controversy over comments on property market

0:01 AM, 8th January 2024, About 10 months ago 2

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Generation Rent slams Natwest chairman for his comments about the property market.

Sir Howard Davies told the Radio 4 Today Programme, he “did not think it was difficult to buy a house at the moment”.

His comments have raised eyebrows in the industry with Generation Rent asking “what planet does Sir Howard Davies live on”.

Not difficult to buy a house at the moment

On the Radio 4 programme, presenter Amol Ranjan asked Sir Davies when he thought it would be easier for people to get on the property ladder.

Sir Davies shocked both the presenters when he said it was “not difficult to buy a house at the moment”.

When pressed about his comments Sir Davies told the presenter: “What we saw in the financial crisis in 2008 was the risk of having people able to borrow 100% to get onto the property ladder, and then suffering severe falls in the equity value of their houses, and having to leave a bad credit record etc.

“There were dangers in very easy access to mortgage credit so I totally recognise that there are people who are finding it very difficult to start the process and they will have to save more.

He added: “In my opinion, inherent change in the financial system is a result of the mistakes that were made in the last global financial crisis and we have to accept we’re still living with that.”

Incredibly hard for people to buy a home

The latest Halifax house price index reveals, the current average cost of a house is £287,105, which is an increase of £4,800 compared to the previous year, and the highest since last March.

According to research by Generation Rent, the time it takes to save for a mortgage deposit in England has now hit 10 years.

Ben Twomey, chief executive of Generation Rent, criticized Sir Davies for his comments.

He said: “What planet does he live on? This is astounding to hear from a senior banker. We are in a cost-of-renting crisis, which is making it incredibly hard for people to buy a home as we hand a third of our wages every month over to our landlord.

“Interest rates have increased but house prices have yet to correct, meaning we still need to save for a huge deposit but also would need a high income to afford monthly mortgage repayments.”

Mr Twomey blames the government for failing to keep house prices in check.

He adds: “Banks can’t keep blaming mortgage regulations for the plight of first-time buyers. It is the result of the government’s failure to keep rents and house prices under control.

“We need to be building more homes in the places where people want to live, especially social housing, to ease the pressure on rents and keep more cash in renters’ pockets. The first step to solving the housing crisis is recognising that we have a problem, and a very serious one too.”

You can watch the video with Sir Howard Davies on the Today Programme below


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Blodwyn

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10:31 AM, 8th January 2024, About 10 months ago

Sir H Davies would seem well past his 'best before' date if that is how his brain works?
Most of us know parents who have grown up working children still living at home?
Or perhaps he pays his staff so well that they are truly insulated from everyday reality?

Martin Roberts

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11:49 AM, 8th January 2024, About 10 months ago

Of course it’s easy to buy a house, if your paid £750k.

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